Shenzhen city drops 30 million free digital yuan to boost consumer spending

According to local newspaper Shanghai Securities News, the city of Shenzhen airdrop 30 million digital Chinese yuan (e-CNY) to local res...



According to local newspaper Shanghai Securities News, the city of Shenzhen airdrop 30 million digital Chinese yuan (e-CNY) to local residents in an effort to revitalize consumer spending.

The airdrop is a joint effort between the city of Shenzhen and Meituan Dianping, China’s leading food delivery app. According to the instructions, users must first log in to the Meituan APP, register for the incentive, and then optionally receive the e-CNY rewards in a sweepstakes.

If chosen, the e-CNY is then distributed to users and can be spent at more than 15,000 in-app merchant terminals that accept state-owned digital currency. Previously, the People’s Bank of China identified e-CNY as a potential tool to advance regional economies and improve the efficiency of certain financial services. Meanwhile, Meituan sources say e-CNY plays a vital role in boosting spending and revitalizing local businesses. Shenzhen is also currently one of the three cities of China where residents can pay municipal taxes and charges with e-CNY.

Related: Bill to ban Chinese digital yuan from US app stores

Unlike many other countries, China has strictly adhered to a zero COVID policy which has seen the repeated lockdown and closure of non-essential businesses in major financial hubs such as Shanghai. Last Wednesday, Chinese Premier Li Keqiang held an emergency meeting with senior Communist Party officials to discuss the devastating economic effects of the country’s COVID policies. Amid economic deficits, 20 of China’s 31 provinces issued “consumption incentives”, such as the recent e-CNY airdrop, from January to April.